With its orchards, stunning scenery, wineries, historic buildings, quaint small-town vibes, and prime location along Lake Superior’s picturesque shoreline, it is no surprise that Conde Nast Traveler listed Bayfield as one of the “23 Best Places to Go in the U.S. in 2023”.
As one of Wisconsin’s most popular tourist destinations, short-term rentals are thriving in Bayfield and the surrounding areas, making rental investment opportunities widely sought after by investors.
If you are considering investing in a short-term rental in our area, we’ve put together a guide to what to look for in a short-term rental property and how to start a short-term rental in Bayfield County.
A Guide to Short-Term Rental Investments 
Wisconsin is known for being a supportive state for short-term rental owners, making our area an excellent location to consider for short-term rental investments.
However, there are some factors to be aware of when investing in a short-term rental to ensure a profitable outcome. Here are some crucial aspects to keep in mind when researching or starting a short-term rental in Bayfield County.
1. Find a Real Estate Professional With Experience in Short-Term Rental Investments
When looking for a short-term rental investment, find a licensed realtor who has expertise working with investors in the short-term real estate market. A knowledgeable real estate agent can save you time in your search and ensure you find the ideal short-term rental for your goals.
Our team at Broad Street Brokers has the industry insight and local knowledge to help you invest in profitable short-term rentals. With all our agents’ firsthand experience in the hospitality and short-term rental industry, and Suzie and Esme’s lifelong residency in the Bayfield area, our collective knowledge serves as an invaluable resource for area investors.
2. Pick the Right Location
As they say in real estate, it’s all about “location, location, location”. The same goes for short-term rental investments.
When considering where you want to purchase property for a short-term rental, ask yourself:
- Do you want your guests to be within walking distance of city attractions, such as shops, marinas, and restaurants?
- Or, do you want a more rural location that offers guests a chance to immerse themselves in nature?
- Do you want to be within easy walking or driving distance of the rental for property management duties?
- Where are other short-term rentals located in the area?
- Which local areas have the most supportive regulations in terms of short-term rentals?
3. Check Local Permits and Ordinances
Bayfield County’s Guide to Starting Your Vacation Rental is an excellent resource, filled with detailed information on local requirements, licensing, insurance, zoning permits, and room tax.
Here’s a brief look at some of the permits and ordinances you’ll need to obtain and follow to start a vacation rental in Bayfield County:
- All short-term rental operators in Wisconsin must have a State Lodging License. Information regarding this license can be obtained by contacting the Bayfield County Health Department.
- Short-term rental operators must follow the Lodging License Checklist (this checklist details requirements such as testing private well water at least once a year and submitting the results to the county health department, garbage and recycling requirements, having an approved private well and private septic, etc.).
- Operators will need to obtain a zoning permit from Bayfield County and/or their local municipality.
- Contact your insurance provider about obtaining a business policy. Standard insurance policies are often limited to residential coverage and do not cover commercial risks.
- Short-term rental owners will need to inquire about any room tax collected by their local municipality.
4. Determine a Property Management Plan
Property management for short-term rentals is far more time intensive compared to long-term rentals.
Before investing, have a plan in place that address the following questions:
- Who will clean the property after guests leave and before the next guests arrive?
- Who will launder the towels, linens, and sheets?
- Who will take calls in the event of a guest concern, appliance failure, or other unforeseen circumstances?
- Who will handle day-to-day operations?
- Who will maintain the property (i.e. mowing the lawn, watering flowers, snow removal, etc.)?
5. Decide How You’ll Advertise Your Short Term Rental
How will guests find your short-term rental?
Once your short-term rental is licensed, the Bayfield County Tourism Department adds the rental to its website section for local businesses.
If you list on a short-term rental platform, your rental will automatically gain online exposure. You may also want to consider starting a website to advertise your short-term rental.
It is helpful to contact your local chamber of commerce to ask about advertising.
Bayfield County Tourism Resources for Businesses
Bayfield Chamber of Commerce
Madeline Island Chamber of Commerce
Washburn Chamber of Commerce
Iron River Area Chamber of Commerce
6. Calculate ROI
Short-term rentals can be an extremely worthwhile investment, but profit depends on a variety of factors.
First, decide if you are simply looking for some extra spending money or if you want to start a short-term rental business.
When looking at properties, calculate the ROI to determine if it is a sound investment. Consider how much other area rentals are going for on a nightly basis and how they compare to the property you are considering.
When calculating ROI, be sure to factor in the following aspects that will affect your profit:
- Varying occupancy rates (research other short-term rentals nearby to get a sense of expected occupancy rates)
- Property management fees, if applicable
- Advertising and marketing cost
- Local room tax, if applicable
- Maintenance fees
- Property taxes
- Insurance cost
Additional Resources on Short-Term Rentals in Bayfield County
For more details and helpful information on starting a short-term rental in Bayfield County, here are some additional resources:
- Bayfield County Health Department Lodging License Application
- Short-Term Rental Guide
- Bayfield County Planning and Zoning Permit Application
- Bayfield County Planning and Zoning Ordinance
- Fee Schedule
Looking for the Right Investment Property for Your Short-Term Rental?
The success of a short-term rental will depend heavily on the location, local ordinances and regulations, occupancy rates, and property management.
With firsthand experience in the short-term rental industry, almost 40 years of combined real estate experience, and a deep love of the area, our team has the skills and expertise to responsibly help investors find their ideal property for short-term rental purposes.
We’ve worked closely with many area investors, connecting them with properties that fit their criteria. We also keep in close connection with the local management companies to follow local trends so we can best advise you regarding the potential of your investment.
Our team is here to guide you in making a sound investment decision and to help you find the ideal property for your goals. Contact us today with questions or to get an automatic search set up based on your parameters.
Written by superiorcopywriti
All photo credits IStockphoto.com